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Inheritance of a property - rent it out as income?

Dunney77
Posts: 49 Forumite
Hi there,
A family member passed away last year and I have come to inherit a three-bedroom property currently valued at £700,000 (mortgage paid off).
I am only 23 and have since moved to the City to start my own career in finance. This obviously creates the problem of an empty house, not in London.
To boost income, I am looking at renting the property out (I believe I can get a gross income of £2,000 p/m). However, as I don't live in its area, is there a way to reduce my involvement in its rental?
Just wondering what peoples' recommendations would be on how to proceed as I would love to bring in extra cash per month but can this be done?
Best!
A family member passed away last year and I have come to inherit a three-bedroom property currently valued at £700,000 (mortgage paid off).
I am only 23 and have since moved to the City to start my own career in finance. This obviously creates the problem of an empty house, not in London.
To boost income, I am looking at renting the property out (I believe I can get a gross income of £2,000 p/m). However, as I don't live in its area, is there a way to reduce my involvement in its rental?
Just wondering what peoples' recommendations would be on how to proceed as I would love to bring in extra cash per month but can this be done?
Best!
0
Comments
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Where is it, that you think you'll get £2k a month for a 3 bed house?!
Anyway that aside, you'll be a landlord with all the obligation that come with it. You can hire an agent, who will charge 10-15%, but ultimately you'll be responsible. e.g. deposit not protected, you're in court.
Not easier to sell and invest the money?0 -
See New Landlords and Letting Agencies.
Even if you use a letting agency, ultimately the buck still stops with you in terms of deposits, gas safety certificates and other landlord responsibilities.
Are you renting in London just now? If so, what about selling the house and using the money to buy somewhere in London to live?
Edit: I've just seen that the property is in the Channel Islands so the two links I provided probably aren't relevant although might give you some food for thought.0 -
Where is it, that you think you'll get £2k a month for a 3 bed house?!
Anyway that aside, you'll be a landlord with all the obligation that come with it. You can hire an agent, who will charge 10-15%, but ultimately you'll be responsible. e.g. deposit not protected, you're in court.
Not easier to sell and invest the money?
Channel Islands, which has a similar property market to London.
Not really as my family member worked hard all his life to reach that property. Doesn't feel right to sell it.
Any insight into a potential net income?0 -
If you have an emotional attachment to the property then I wouldn't recommend letting it unless you can get over it.0
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Net income will depend on your tax situation - there is also the fact the property is located outside the UK which complicates matters.
You need professional advice.0 -
Channel Islands, which has a similar property market to London.
Not really as my family member worked hard all his life to reach that property. Doesn't feel right to sell it.
Any insight into a potential net income?
Sorry not my area.
However if you have sentimental attachment, what happens if a tenant trashes it?0 -
A career in finance you say !
My mind has just been 'boggled'.0 -
Pretty poor return on £700k, I'd be hoping to get at least £3000 a month0
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You'll need to research the Channel Islands tenancy laws. My links above (thanks Pixie!) will give some ideas of what's involved but are England/Wales related.
If you have a friend or family member there you could ask them to manage it. Save the (12%?) agency fees and maybe give them something too. Otherwise your income is really dubious. Might do better selling and spreading the £700K around various investments. Since you work in finance this should not be a problem!0 -
Unless you are keeping the property in the expectation that it will appreciate, then £700K a year sensibly invested in the stock market (minus a cash reserve of say £50K put into interest bearing current a/c's) should get you a return of 3% or more. That's about £21K a year, or rather more than you'll net from renting it out.
That rental quote seems quite low for the CI, have you actually had an agent value it for rental purposes?No free lunch, and no free laptop0
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